Says Supermarket Collusion Keeps Prices High

Silent consultation between low-cost retailers in Iceland keeps prices artificially inflated, says Auður Ava Ólafsdóttir, project manager of price oversight at the Icelandic Confederation of Labour. Supermarkets Bónus and Krónan take advantage of a small market to keep prices high when they could be lowered, Auður stated in an interview on RÚV morning radio today.

“These two parties are in a very similar place in terms of prices and they naturally only see it in their favour to keep prices in a certain place,” stated Auður. “Although these are low-cost retailers in Iceland they could actually be lowering prices more than they are.”

“There is leeway here in Iceland for price reductions, as we saw when Costco came to the country. It’s cheap to import goods and the króna is strong. There are many factors that should have the effect of reducing prices, yet prices have remained quite stable for many years.”

This is because Krónan and Bónus take advantage of the Icelandic market’s lack of competition, Auður says. “They’re careful not to compete with each other’s prices too much because both parties would lose out. It is to the economic advantage of both to have it that way and they can do it by virtue of their strong position.”

Auður says she hoped Costco’s opening in May of last year would lower prices over the long term, but the wholesale retailer’s effect seems to have been temporary. Prices “took a little dip until they opened and into the fall and then rose again and are back to a similar level as before.”

Guðmundur Marteinsson, Bónus’ CEO, says the small price difference between products at Bónus and Krónan can be attributed to both companies lowering prices as much as possible. “There is no leeway for price reduction,” he stated. “We cannot sell products at below cost.” He pointed out that Costco’s recently published annual financial statement showed a loss of ISK 100 million ($900,000/€780,000).

Gréta Margrét Grétarsdóttir, CFO of Festi, also denies the two retailers are artificially inflating prices, insisting the similarity in price between the stores is a result of active competition rather than consultation.

Suspected of Drug Trafficking Operation

A foreign man is suspected of playing a key role in an extensive drug trafficking operation to Iceland, Vísir reports. The Land’s Court has placed a travel ban on the man until September 26.

The man is connected to a case involving five arrests and the trafficking of nearly five kilograms of hard drugs to the country. Authorities discovered the drugs in two packages of tools being shipped to the country, one from Germany and the other from the United States. The substance was similarly concealed in the base of the packages. An address and name was provided for the delivery, giving police a lead.

Once the recipient received the package, the base was taken to a workshop, where the recipient met the aforementioned defendant and two others. When police arrived, the parties appeared to be in the process of unscrewing the base in order to remove the drugs. Police found other similar boxes in the workshop, suggesting the parties had previously trafficked illegal drugs into the country using the same method. Other details of the case also point to organised drug trafficking over some period of time.

Three of the five defendants currently face a travel ban, as the case is extensive and stretches across several countries.

Icelandic Gaming Company Sold for $425 Million

CCP Games, Iceland’s largest gaming company, has been sold to Korean company Pearl Abyss for ISK 46.6 billion ($425m/€365m), Kjarninn reports. CCP is best known for producing EVE Online, a multiplayer online game.

“CCP Games will continue to operate independently as a developer with studios in Reykjavík, London, and Shanghai, while integrating the company’s extensive development and publishing expertise into Pearl Abyss’ operations for all current and future projects,” states a press release on CCP’s website.

“Pearl Abyss is a fast-growing company with lots to offer in terms of technology, capability and vision,” stated CCP Games CEO Hilmar Veigar Pétursson. “I believe our two companies have a lot to learn from each other. We are very excited to join forces with them and achieve great new heights for our companies, our games and – above all – our players.”

A sale of CCP Games has been in the works for some time. In 2016, it was reported that the company’s largest owners were considering the move. Though the company has performed well over the last two years, it was sold for significantly less than its projected value in 2016. Last October, the company announced a restructuring plan which affected over 100 of their roughly 370 employees worldwide. As a result, the company’s Atlanta office was closed and their Newcastle office sold, and virtual reality game development was temporarily suspended.

Police Search for Andrius Zelenkovas

Update 06.09.2018: Andrius has been found.

Icelandic police are searching for Andrius Zelenkovas, a 27-year-old Lithuanian man. Andrius is described as 175cm (5’9’’) tall, with a slim build and light hair. Andrius is believed to have been travelling to Akureyri in early August but his whereabouts since are unknown. The case was reported to the police on September 3.

Any individual with information about Andrius’ movements or whereabouts is asked to contact police by phone at +354 444 1000, by email at [email protected] or by private message on the Facebook page of Reykjavík Capital Area Police.